Professional Documents
Culture Documents
Short -Term
Long -Term Measure
Measure
• Economic development
• CRR
from deficit financing
• SLR
• Repo
EXPANSIONARY MONETARY
POLICY
Problem - Recession and unemployment
• Inflation Projection
– Keeping in view domestic demand-supply balance and the
global trend incommodity prices, the baseline projection for WPI
inflation for end-March 2011 is Placed at 5.5%.
• Monetary Projection
– The projection of money supply growth (M3)=
17%.
– aggregate deposits of Scheduled Commercial
banks (SCBs) are projected to grow by 18%.
– The growth in non-food credit of SCBs is
placed at 20%.
Third Quarter Review of
Monetary Policy 2010-11
India’s Monetary Policy
Update
Inflation and Monetary Policy
• Inflation is always considered as a major vexation for the India’s central
bank.
• India's food inflation rate declines to 10.39 per cent on March 03, 2011
• Food inflation rises to 11.49 percent on February 24, 2011
• India food inflation declines to 11.05 percent on February 17, 2011
• India food inflation declines to 13.07 percent on February 10, 2011
• India food inflation rose at 17.05 percent on February 3, 2011
• India food inflation rose at 15.57 percent on January 27, 2011
•
•
•
• The inflation rate in India was last reported at 9.3
percent in January of 2011.
• From 1969 until 2010, the average inflation rate in
India was 7.99 percent reaching an historical high of
34.68 percent in September of 1974 and a record low
of -11.31 percent in May of 1976.
RBI raises rates, warns on food
inflation(Tue Jan 25, 2011)
• The RBI raised its repo rate , at which it
lends to banks, to 6.5 percent from 6.25
percent and it lifted its reverse repo rate ,
at which it borrows from banks, to 5.5
percent from 5.25 percent.
India needs tight monetary po
licy: C Rangarajan
• C. Rangarajan, the chairman of the Prime
Minister's Economic Adivisory Council,
said he expected headline inflation to ease
to 7 percent by March 2011
• He saw foreign direct investment at $27.6
billion in FY11, rising to $40 billion in
2011/12.
RBI extends special liquidity
measures till April 8 (25 JAN, 2011)